Bloated Inventories Lead GM To Idle Cadillac Plants
Back in May, we reported on the rather fat inventory levels of Cadillac’s products, examining through the context of the one product with less than 100 days of supply – the SRX crossover. A few months later, dealers are tight on the newly redesigned Escalade, but the inventory picture for Cadillac’s car lineup hasn’t gotten much better.
Automotive News is reporting that GM’s Lansing, Michigan factory will sit idle for three weeks, starting next Monday. While the inventory woes of the Cadillac ELR plug-in hybrid have been well publicized, inventories of key models like the ATS and CTS are rather high. Currently, there’s a 152-day supply of the ATS, in line with when we last checked in during May, but the CTS has a 215-day supply, up from 138 days in May, and an astonishingly high number by industry standards. The XTS large sedan and the ELR have 152 and 194 days worth of supply respectively.
AN paints a bleak picture of Cadillac’s commercial performance, writing
Cadillac’s car inventory stood at 44,700 units on Aug. 1. That’s equal to a 172-day supply — about triple the level that is considered healthy. By comparison, Lincoln’s car inventory was 87 days on Aug. 1. Audi’s was 45 and BMW’s was 42. Overall, Cadillac’s U.S. sales have slipped 2 percent to 97,358 this year through July, in a luxury market that has expanded 6 percent.
From a nameplate perspective, the massive inventories of the CTS are an ominous sign. The CTS was widely praised in the motoring press, besting major German rivals in comparison tests, and heralded as proof that Cadillac had finally mustered up the product needed to compete with Tier 1 luxury brands. But none of that has converted into sales, despite numerous lease specials and cash incentives. As AutoPacific’s Dave Sullivan told TTAC
The last generation CTS presented a tremendous value – almost a 5-Series sized sedan that was priced like a 3-Series. The new CTS is a bit of a turn off when it comes time to replace your CTS lease. The ATS is too small and people feel like they are getting less car for more money. It’s going to take time for people to readjust since Cadillac has basically resegmented the CTS.
More by Derek Kreindler
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Prices way too high, even in my town which is a GM town that has never had any problems selling Escalades, the dealership by me has had one sitting there for almost 2 months now. Drove 900 miles in the last 4 days, including damn near all over the lower part of Canada, including downtown Toronto where I saw every car imaginable including an F12 and an Aventador, my whole trip, 2 new Escalades. CTSs and ATSs are piling up too. CTS is way too expensive and the quality and quality of materials poor. The backseat of the CTS is atrocious, thin and small. 2 brand new CTSs on the lot that I looked at in the last month, had door issues. One somehow was able to lock the car and all the doors except one backdoor and when it was opened the alarm went off. Other one the rear door handle was broken and not working and out of alignment. And for Godsake, you can hit $70K in a CTS and still can't get a power closing trunk. Go look at the new Hyundai Genesis, it looks great inside and out and the fit and finish is excellent, for much less money than the CTS and the space inside is cavernous.
Come on Cadillac stop trying to compete with the BMW's, Audi's, and the like. Those buyer's don't care for American iron and never will. Just stick to your roots by building luxurious well made good looking cars that appeal to the American upscale buyers along with the China market, since it appears they like American cars also. We frankly don't care about driving around mountain roads at breakneck speeds or seeing how fast cars can go on the Autobahn just American comfort, luxury and reliability at a competitive price.